A company founded by physicists and that is developing means to apply artificial intelligence to drug discovery and development has raised more than $300 million in a venture capital financing round.
Cambridge, Massachusetts-based XtalPi said Monday that it had raised a Series C funding round of $318.8 million, co-led by SoftBank Vision Fund 2i, PICC Capital and Morningside. Existing investors, many based in China, also took part, including Tencent, Sequoia China, China Life and SIG. Other investors listed on the company’s website include ZhenFund, Frees Fund, Google, China Life and Renren.com.
The company describes itself as having been founded in 2014 by quantum physicists at the Massachusetts Institute of Technology. In an email, spokesperson Ruyu Wang noted that since its founding, the company has added several biopharma industry veterans, including Alan Jiang, chief strategy officer and formerly of Sanofi-Genzyme; VP of science affairs Yuriy Abramov, previously at Pfizer; and Teng Lin, SVP business development, formerly of biopharma industry software maker Schrodinger.
“The founders believed true innovation can happen across disciplines,” Wang wrote. “They saw complex pharmaceutical interactions as fundamentally physics questions of molecule and protein behaviors and interactions that can be predicted on the atomic level using quantum theory-based methods.”
The company said that with Series C round, it plans to combine quantum physics, artificial intelligence and cloud computing to create new drug candidates. The company’s model combines physics- and data-driven models to address drug properties relevant to progression into clinical trials, further combining the predictions from its platform with real-world data from laboratories. The idea is to create more drug candidates using fewer experiments in less time.
Wang noted that in the Series C round, XtalPi prioritized investors whose vision aligned with the company’s and would provide the support its artificial intelligence-based R&D platform would need, hence the focus on firms in the technology, insurance and financial fields. However, he added that the company has received “explicit investment interest” from life science investors and pharmaceutical companies’ venture capital funds as early as when it raised its Series B round, the closing of which it announced in January 2018. That round was worth $15 million and was followed by a $46 million Series B-1 extension in October of that year.
A Deep-dive Into Specialty Pharma
A specialty drug is a class of prescription medications used to treat complex, chronic or rare medical conditions. Although this classification was originally intended to define the treatment of rare, also termed “orphan” diseases, affecting fewer than 200,000 people in the US, more recently, specialty drugs have emerged as the cornerstone of treatment for chronic and complex diseases such as cancer, autoimmune conditions, diabetes, hepatitis C, and HIV/AIDS.
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